August 13, 2019 Headlines

Treasury prices were higher overnight on Hong Kong concerns (departing flights cancelled amid protests) and weaker German data, but prices have retreated to slightly lower on the day on what appears to be a bit of rally fatigue. The July CPI report was just released, and consumer price growth was higher than expected, particularly for core inflation. CPI excluding food and energy rose 0.3% m/m (0.2% expected), and on a year-over-year basis, core CPI was up 2.2% in July versus expectations for the metric to remain unchanged at 2.1%. Small business optimism was also better than expected in July, with the NFIB index rising 1.4 points to 104.7 (104.0 expected), with 7 of the survey’s 10 components posting gains versus the prior month.

Despite decent domestic economic data of late, the word “recession” is being repeatedly dropped by media and street analysts, which naturally sparks questions of how that weighs on sentiment and consumer behavior. The Fed has a challenging decision in September and beyond. There are many bearish signals in the global financial markets (gold & other commodities, equities, etc.) in response to multiple economic headwinds, most notably U.S./China trade tensions. The markets are expecting a strong response from the Fed in September, with a 25% probability of a 50 bps rate cut currently priced in (75% probability of a 25 bps cut). Will the Fed actually cut rates and initiate another round of quantitative easing in the near future with core inflation actually trending higher? Fed leaders clearly have a lot of external pressure to act, but that’s not exactly a new phenomenon (except for the overt pressure from the White House).

Jason Haley
Managing Director, Investment Management Group

DateEventSurveyActualPriorRevised
8/13/2019NFIB Small Business Optimism104104.7103.3—
8/13/2019CPI MoM0.30%0.30%0.10%—
8/13/2019CPI Ex Food and Energy MoM0.20%0.30%0.30%—
8/13/2019CPI YoY1.70%1.80%1.60%—
8/13/2019CPI Ex Food and Energy YoY2.10%2.20%2.10%—
8/13/2019CPI Core Index SA263.3263.57262.8—
8/13/2019CPI Index NSA256.44256.57256.14—
8/13/2019Real Avg Hourly Earning YoY—1.30%1.50%—
8/13/2019Real Avg Weekly Earnings YoY—0.80%1.20%—
8/13/2019Mortgage Delinquencies——4.42%—
8/13/2019MBA Mortgage Foreclosures——0.92%—
8/14/2019MBA Mortgage Applications——5.30%—
8/14/2019Import Price Index MoM-0.10%—-0.90%—
8/14/2019Import Price Index ex Petroleum MoM-0.10%—-0.40%—
8/14/2019Import Price Index YoY-2.00%—-2.00%—
8/14/2019Export Price Index MoM-0.10%—-0.70%—
8/14/2019Export Price Index YoY——-1.60%—
8/15/2019Empire Manufacturing2—4.3—
8/15/2019Nonfarm Productivity1.40%—3.40%—
8/15/2019Unit Labor Costs1.90%—-1.60%—
8/15/2019Philadelphia Fed Business Outlook9.3—21.8—
8/15/2019Retail Sales Advance MoM0.30%—0.40%—
8/15/2019Retail Sales Ex Auto and Gas0.40%—0.70%—
8/15/2019Retail Sales Ex Auto MoM0.40%—0.40%—
8/15/2019Initial Jobless Claims212k—209k—
8/15/2019Retail Sales Control Group0.40%—0.70%—
8/15/2019Continuing Claims1685k—1684k—
8/15/2019Industrial Production MoM0.10%—0.00%—
8/15/2019Manufacturing (SIC) Production-0.30%—0.40%—
8/15/2019Capacity Utilization77.80%—77.90%—
8/15/2019Bloomberg Consumer Comfort——62.9—
8/15/2019NAHB Housing Market Index65—65—
8/15/2019Business Inventories0.10%—0.30%—
8/15/2019Net Long-term TIC Flows——$3.5b—
8/15/2019Total Net TIC Flows——$32.9b—
8/16/2019Housing Starts1257k—1253k—
8/16/2019Housing Starts MoM0.30%—-0.90%—
8/16/2019Building Permits1270k—1220k1232k
8/16/2019Building Permits MoM3.10%—-6.10%-5.20%
8/16/2019U. of Mich. Sentiment97—98.4—
8/16/2019U. of Mich. Current Conditions——110.7—
8/16/2019U. of Mich. Expectations——90.5—
8/16/2019U. of Mich. 1 Yr Inflation——2.60%—
8/16/2019U. of Mich. 5-10 Yr Inflation——2.50%—

 

 

 

 

 

 

 

Subscribe Today!

Subscribe to our email list and get the latest articles and announcements from ALM First.

Subscribe

Recent Articles

ALM First offers investment advisory services through ALM First Financial Advisors, LLC, which is registered with the U.S. Securities and Exchange Commission (“SEC”). SEC registration does not constitute an endorsement of the firm by the SEC nor does it indicate that the firm has attained a particular level of skill or ability. The information contained herein does not constitute investment advice or a recommendation for you to purchase or sell any specific security. You are solely responsible for reviewing the content and for any actions you take or choose not to take based on your review of such content.Information contained herein was derived from third party sources as indicated. While such information is believed to be reliable, no representation or warranty is made concerning the accuracy of any information presented. We have not and will not independently verify this information. Where such sources include opinions and projections, such opinions and projections should be ascribed only to the applicable third party source and not to ALM First.Statements herein that reflect projections or expectations of future financial or economic performance are forward-looking statements. Such “forward-looking” statements are based on various assumptions, which assumptions may not prove to be correct. Accordingly, there can be no assurance that such assumptions and statements will accurately predict future events or actual performance. No representation or warranty can be given that the estimates, opinions or assumptions made herein will prove to be accurate. Any projections and forward-looking statements included herein should be considered speculative and are qualified in their entirety by the information and risks disclosed in the confidential offering document. Actual results for any period may or may not approximate such forward-looking statements. No representations or warranties whatsoever are made by ALM First Financial Advisors, LLC or any other person or entity as to the future profitability of investments recommended by ALM First Financial Advisors, LLC.